Has anyone ever contacted you about a house that wasn’t for sale but was instead listed as (*gasp*) for rent? If your response to that lead was “I don’t do rentals,” you’re missing out on a great source of revenue. I’m not talking about the revenue from the rentals. I’m talking about the sales that those renters will eventually turn into. Some rentals may take years to convert, but others may be ready to buy now and just haven’t realized it. You’re sitting on a cache of leads that are just waiting to be worked. Here are five tips to help you start monetizing rental leads.
1. Take Rentals Seriously
Millennials are currently the largest group of buyers, and that’s not likely to change any time soon. A recent NAR survey defined millennials as those 35 and under, and with the median age of a millennial homebuyer currently set at 30 years old, they’re just getting started as a force in real estate. For now, younger millennials are building their careers and working on their down payments, but soon they’ll be ready to transition from renters to buyers, and if you’re the one who helps them find their rental property, you’ll know exactly when their leases expire. This puts you in an ideal position to contact them about buying a home when their rental period comes to an end.
2. Be Semi-Selective
Try setting a minimum price point (e.g., $1500/month) for the rental leads you’re willing to work. If you have a team, you can designate a specific agent to work these leads; just make sure you stay in touch with the renter throughout their search. Once they sign the lease for their dream home, send them a small gift basket to celebrate. This helps you build a positive relationship with the renter that you can continue to develop in the future.
3. Point Them in the Right Direction
After your client moves into the home you (or your team) helped them find, add them to a drip email campaign and invite them to follow you on social media to keep in touch. Make sure your campaign includes emails with tips on how to save for a down payment, top ways to prepare to buy a home, and the benefits of buying vs. renting. After they’ve been in their home for about nine months, reach out to them directly to see if they might be interested in buying since their lease is coming to an end. Because you know what they were looking for in a rental, you’ll have a good idea about what they might like in a home purchase.
4. Sell Leads You Can’t Use
If you set your minimum rental requirement at $1500/month and get leads that don’t meet your price point, farm them out to other agents. New agents or agents who specialize in rental leads may be better suited to work those leads. Offer to sell your rental leads for a nominal fee ($5 each). Over time they’ll begin paying for themselves.
5. Figure Out if Your Renter is Qualified to Buy
As Chris Smith says in his book The Conversion Code, “conversations lead to conversions.” Just because someone fills out a form asking about renting a home doesn’t mean they aren’t qualified to buy. Many renters have great credit scores and healthy savings that could be put towards a down payment if they decide to buy a home. Many of these renters may not realize they can afford to buy a home or may not understand the benefits of owning versus renting. Until you have a conversation with them and really dig deep to understand their needs and motivations to rent, you will never know how many potential sales you are missing out on.
Rental leads are a great way to increase your client list. The best part is, most agents aren’t investing much time or money in their rental leads, leaving you a market of largely untapped potential. Put these tips to the test and find your business thriving in this underutilized niche! Homes.com can help connect you with quality rental leads in your area. Don’t let any more rental leads slip away!